Measuring Integrated Advertising

I have a lot of respect for Mark Suster, an entrepreneur who turned venture capitalist and now is investing out of GRP Partners.  He writes a terrific blog called Both Sides of the Table and his posts are picked up on TechCrunch and other major outlets.

He recently wrote a declarative post called The Future of Advertising Will be Integrated.  The post went up on April 29th but I’ve been noodling it ever since. Due to some personal obligations, I’ve not been able to respond, but finally, here it is.

As an entrepreneur turned ad agency guy, when I hear the word “integrated,” I immediately think media and creative under one roof, such as my firm, kirshenbaum bond senecal + partners.  I personally believe this is really the only way to go if you want to get to a big platform.  With media and creative all under one roof, under one P&L, and with a cohesive team, you can create big ideas that know no creative or media boundaries.

We have a saying internally at the agency, E=(MC)2, which is obviously repurposed, but it means a “[brand] experience” is exponentially greater when media and creative work together.

Enough agency speak for now but keep this last sentence in the back of your mind as you read the rest.  I hope you do.

Mark came at his post a bit differently and took the above tenants, whether he realized or not, and applied them to the digital media ecosystem today.  He highlighted a few companies such as my buddy Ari’s company, Solve Media, along with Adly and Kontera (amongst others).  The creative is the media in most of these, along with the media being the creative.  I’d argue Paid Search links play here as well.

The Elephant in the Room

One of the largest issues that the digital advertising ecosystem faces today is that we as an entire industry, are not setup to measure the “integrated” nature effectively. Because of this, at scale, this is not a near term reality.  There, I said it.  The elephant is in the room.

The digital advertising ecosystem by default rewards the intent harvesters, not the intent generators.  The primary reason why is that many agencies and marketers are using 3rd party ad serving systems that reward the last click or last action.  In the world of rewarding the last click or action, generally, the ad networks are the ones who win out.  There are 400 (or 700 depending on who you talk to) or so ad networks in the world who have nice businesses.  Just look at ValueClick or InterClick’s financial statements as they are public.  Not too bad.

THE Digital Opportunity

Because of the above, therein lies an opportunity.  If we believe what Mark wrote last week and I’ve been saying for years, then an opportunity lies in being able to create a measurement platform that allows us to understand intent harvesting and intent generation/creation. Piecing together a DART (3rd party ad server) report with a ComScore or Knowledge Networks study is inefficient and frankly, annoying.   There needs to be an evolution here.  This is a big opportunity.

Where We Are Today

Many readers of this blog don’t work in advertising agencies but are awesome entrepreneurs looking to figure out the next big idea to go and tackle.  Being that you are not in the walls of agencies on the daily basis, I thought I’d take the remainder of this post to outline where the industry is in terms of advanced analytics and then open this up for commenting in the thread below.

I highly request that you engage in the comments as group knowledge will benefit the community at large, you might find your next co-founder, and I love open conversations.

Ad Serving:  The Madison Avenue ecosystem basically uses one of three third party ad servers to “serve” and “track” different pieces of creative.  We use Microsoft’s Atlas, DoubleClick’s DART, and MediaMind.  In Q1 2011, we moved the majority of our clients off of Atlas and onto MediaMind because I personally have a strong viewpoint of independence of my ad-server and it’s relationship to media. (should be separate)

Data Warehousing:  This is a relatively new area and somewhat unchartered territory for many agencies.  Many agencies rely on their third party ad-server to be their main data warehouse for tracking. This is good, as you’d be surprised how many people don’t use a 3rd party ad server, but this is not great. Using a full on data warehouse such as VisualIQ, Neteeza, Artemis, or others allows for a larger capability to manipulate data and understand the relationships between touchpoints beyond “last click.”

At the agency, we’ve been using VisualIQ with some of our most progressive clients and the reports and results we’re seeing are fascinating.  One of the biggest questions we’re tackling is “optimal touchpoint analysis” and we’re seeing the relationships between display, video, search, social, and beyond.  We can now determine a value to each one.

Brand Lift Studies:  While I’ve argued time and time again, that “brand” advertising for the sake of brand advertising online is dead, many marketers continue just spending on “brand.”  Agencies use 3rd party brand study vendors such as ComScore, Knowledge Networks, Vizu, and others that help measure the “lift” (or change) associated in any one of many categories including but not limited to awareness, intent, and consideration.

Opportunities

·     The basic ideas behind today’s ad serving systems were conceptualized in the mid to late 1990s.  Online video, social, search, etc were not around then.

·     Product placement and integration into online video and social are hard to quantitatively measure with a 3rd party ad serving system as the only metrics you can pull back to your ad server are by using a click-tag.

·     The Display ecosystem is being fractured into traditional display (i.e. banners on ESPN) and social display (i.e. creative/textual units on Facebook, LinkedIn, etc).

·     I see Paid Search and Display converging on each other within the next 12 months. In some cases, they already are: Google Content Network.

·     I challenge you to ask your 3rd party ad-serving vendor to recommend an attribution model – report back what they tell you.  Not much – there is no standard yet.  It’s unchartered territory.

Next Steps

I would obviously love to hear your feedback.  Please post it in the comments section below or shoot me a note.  I believe that we won’t see large integrated opportunities that get their portion of the measurement/attribution credit until there is a way to measure these.  While we might try one or two of these integrated opportunities on each media plan, if you ask the agency how they really performed, the agency won’t have much to tell you because the tools for measurement are ancient.  With the data warehouses mentioned above, we get much better, but not perfect.

While we don’t need perfect to make the industry move forward, we do need better tools.  If you are building them, I’d like to speak to you.

  • http://www.optimizeandprophesize.com/ jonathanmendez

    Great post Darren. I’ve often said the largest opportunity in digital advertising is understanding cross-media impact of Television on Search and determining ways to integrate them more effectively. We’ve advanced very little in the area from 6 years ago when Pontiac made waves by putting the Google search bar in their TV commercial and telling people to search Pontiac. This created some great “branded” inventory for Pontiac and nowadays you’d get some quality data along with it (and cookies for retargeting, etc) but despite the fact that TV drives so much Search inventory little is done to optimize this.

    Of note, I did just see an Old Navy spot last night that has a Shazam link to get the jingle and probably a coupon. At the end of the day online is a demand capture channel. It’s branding value is criminally underrated (see Google being the #1 brand in the World) but its future will be in many ways just like its past, just more intelligent, automated and realtime.

    • http://www.darrenherman.com dherman76

      One of the largest issues with digital today is that it only rewards the demand capture guys, thus, more money flows into that ecosystem. It’s flawed by it’s measurement.

      • http://www.optimizeandprophesize.com/ jonathanmendez

        Well you know where I stand here and that I love this argument. :) The reward for awareness is volume and it’s easily measured. Every other reward is based on conversion and I would argue after spending many years knee-deep in the conversion world that there’s not enough money flowing into it. That’s changing though – witness Macy’s 50% rise YoY in online sales, the only metric that really matters.

  • http://www.optimizeandprophesize.com/ jonathanmendez

    Great post Darren. I've often said the largest opportunity in digital advertising is understanding cross-media impact of Television on Search and determining ways to integrate them more effectively. We've advanced very little in the area from 6 years ago when Pontiac made waves by putting the Google search bar in their TV commercial and telling people to search Pontiac. This created some great “branded” inventory for Pontiac and nowadays you'd get some quality data along with it (and cookies for retargeting, etc) but despite the fact that TV drives so much Search inventory little is done to optimize this.

    Of note, I did just see an Old Navy spot last night that has a Shazam link to get the jingle and probably a coupon. At the end of the day online is a demand capture channel. It's branding value is criminally underrated (see Google being the #1 brand in the World) but its future will be in many ways just like its past, just more intelligent, automated and realtime.

  • http://www.darrenherman.com dherman76

    One of the largest issues with digital today is that it only rewards the demand capture guys, thus, more money flows into that ecosystem. It's flawed by it's measurement.

  • http://www.optimizeandprophesize.com/ jonathanmendez

    Well you know where I stand here and that I love this argument. :) The reward for awareness is volume and it's easily measured. Every other reward is based on conversion and I would argue after spending many years knee-deep in the conversion world that there's not enough money flowing into it. That's changing though – witness Macy's 50% rise YoY in online sales, the only metric that really matters.

  • http://www.jonsteinberg.com jonsteinberg

    Great post. And I agree the logic behind the brand lift survey makes no sense. See http://jonsteinberg.com/?p=804

  • http://www.jonsteinberg.com jonsteinberg

    Great post. And I agree the logic behind the brand lift survey makes no sense. See http://jonsteinberg.com/?p=804

  • JHlavacek

    Was having a discussion the other day about “demand generation” (as opposed to “branding” – a term that I think has a lot of baggage) and how digital needs to start building metrics that represent that and subsequently campaigns that optimize towards it. I think the first step is determining how to “build the demand curve” – much like how a yield curve exercise is done on the harvesting side.

  • JHlavacek

    Was having a discussion the other day about “demand generation” (as opposed to “branding” – a term that I think has a lot of baggage) and how digital needs to start building metrics that represent that and subsequently campaigns that optimize towards it. I think the first step is determining how to “build the demand curve” – much like how a yield curve exercise is done on the harvesting side.

  • http://www.interpretllc.com Michael Dowling

    Darren, I just happened upon your blog and saw what you wrote about Mark Suster’s post on integrated advertising. I was also compelled to comment and did so on his blog and in a subsequent post on my company’s blog. I agree with you that a lot of credit is being given to the intent harvesters and not enough attention is being focused on intent generators. As an industry we’ve moved so far to the side of click performance that we are ignoring the potential for the medium to more effectively drive stronger intent generation. When the primary measure of success is whether someone clicks on an ad, we lose sight of the fact that not everyone is apt to click on ads, no matter the circumstance. However, those consumers are unquestionably impacted by compelling creative and relevant messaging – two areas that aren’t sufficiently measured today.

  • http://www.interpretllc.com Michael Dowling

    Darren, I just happened upon your blog and saw what you wrote about Mark Suster's post on integrated advertising. I was also compelled to comment and did so on his blog and in a subsequent post on my company's blog. I agree with you that a lot of credit is being given to the intent harvesters and not enough attention is being focused on intent generators. As an industry we've moved so far to the side of click performance that we are ignoring the potential for the medium to more effectively drive stronger intent generation. When the primary measure of success is whether someone clicks on an ad, we lose sight of the fact that not everyone is apt to click on ads, no matter the circumstance. However, those consumers are unquestionably impacted by compelling creative and relevant messaging – two areas that aren't sufficiently measured today.

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